McEwen Mining (NYSE: MUX) and Rio Tinto PLC (NYSE:RIO) are both basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, valuation, analyst recommendations, earnings, institutional ownership, risk and dividends.

Profitability

This table compares McEwen Mining and Rio Tinto PLC’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
McEwen Mining -11.33% -1.49% -1.33%
Rio Tinto PLC N/A N/A N/A

Risk & Volatility

McEwen Mining has a beta of -1.32, meaning that its share price is 232% less volatile than the S&P 500. Comparatively, Rio Tinto PLC has a beta of 0.98, meaning that its share price is 2% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for McEwen Mining and Rio Tinto PLC, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
McEwen Mining 0 0 1 0 3.00
Rio Tinto PLC 1 3 14 0 2.72

McEwen Mining currently has a consensus target price of $5.00, indicating a potential upside of 93.80%. Rio Tinto PLC has a consensus target price of $47.67, indicating a potential upside of 0.08%. Given McEwen Mining’s stronger consensus rating and higher probable upside, research analysts plainly believe McEwen Mining is more favorable than Rio Tinto PLC.

Dividends

McEwen Mining pays an annual dividend of $0.01 per share and has a dividend yield of 0.4%. Rio Tinto PLC pays an annual dividend of $2.36 per share and has a dividend yield of 5.0%. McEwen Mining pays out -50.0% of its earnings in the form of a dividend.

Insider and Institutional Ownership

29.3% of McEwen Mining shares are owned by institutional investors. Comparatively, 6.9% of Rio Tinto PLC shares are owned by institutional investors. 26.6% of McEwen Mining shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares McEwen Mining and Rio Tinto PLC’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
McEwen Mining $54.53 million 14.77 -$11.30 million ($0.02) -129.00
Rio Tinto PLC $37.60 billion 2.27 $15.22 billion N/A N/A

Rio Tinto PLC has higher revenue and earnings than McEwen Mining.

Summary

Rio Tinto PLC beats McEwen Mining on 8 of the 14 factors compared between the two stocks.

About McEwen Mining

McEwen Mining Inc. is a mining and minerals production and exploration company. The Company is focused on precious and base metals in Argentina, Mexico and the United States. The Company’s segments include Mexico, Minera Santa Cruz S.A. (MSC), Nevada and Los Azules. The Mexico Operations segment includes properties, such as El Gallo 1 mine and the El Gallo 2 project. The MSC segment includes properties, such as the San Jose mine and other concessions located around the mine. The Company’s properties in Nevada segment include Gold Bar project and exploration properties. The Gold Bar project is a proposed mine project. The Los Azules segment includes various properties, such as Los Azules project, Chonchones project, Laganoso project, La Cerrada project and Other Argentina properties. The Los Azules copper project is an advanced-stage porphyry copper exploration project located in the cordilleran region of San Juan Province, Argentina near the border with Chile.

About Rio Tinto PLC

Rio Tinto plc is a mining and metals company. The Company’s business is finding, mining and processing mineral resources. The Company’s segments include Iron Ore, Aluminium, Copper & Diamonds, Energy & Minerals and Other Operations. The Company operates an iron ore business, supplying the global seaborne iron ore trade. Its Iron Ore product operations are located in the Pilbara region of Western Australia. The Aluminium business includes bauxite mines, alumina refineries and aluminum smelters. Its bauxite mines are located in Australia, Brazil and Guinea. The Copper & Diamonds segment has managed operations in Australia, Canada, Mongolia and the United States, and non-managed operations in Chile and Indonesia. The Energy & Minerals segment consists of mining, refining and marketing operations in over 10 countries, across six sectors: borates, coal, iron ore concentrate and pellets, salt, titanium dioxide and uranium.

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